LatinNews Daily - 12 April 2019

In brief: Brazil

* Terra Forte, one of Brazil’s largest coffee exporters, has filed for bankruptcy protection, to try and restructure its debt of R$1.1bn (US$288m). The company says that it exports around 2.5m sacks of coffee per year (1 sack = 60kg), representing on average 6.5% of Brazil’s coffee exports. Predicting the value of the coffee sack at R$550 (US$143.78), Terra Forte had financed its expansion by leveraging loans through financial institutions including Brazilian banks Bradesco and the state-owned Banco do Brasil (now its two biggest creditors). However, the coffee sack’s value in international markets has fallen significantly, and the revenue generated by coffee exports continues to decrease in the country. According to Brazil’s council of coffee exporters (Cecafé), coffee exports totalled US$379.1m in March 2019, an 11% drop compared to March 2018. The volume of exports increased by 10% year-on-year, however, to 2.9m sacks. The average price for a sack of coffee in March was U$127, 19% lower than in the same month of 2018. In addition, the Brazilian real’s devaluation against the US dollar caused Terra Forte's debt to increase.